METALS-Zinc eases, but near eight-month top on supply concerns

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MELBOURNE, March 14 (Reuters) - Zinc edged down from near eight-month highs on Thursday after comments from U.S. President Donald Trump chilled optimism over an imminent China trade deal, while tight supply of metal underpinned prices.

FUNDAMENTALS

* ZINC: Three-month zinc on the London Metal Exchange eased 0.4 percent to $2,834.50 a tonne after earlier coming close to Wednesday’s peak of $2,848.50, which was the highest since early July.

* PRICES: LME zinc prices held above $3,000 a tonne for most of 2017 and half way through 2018 on the back of a severe shortage of mine supply. High prices encouraged new mine supply, which depressed prices, but smelters have been slower than expected to churn mine supply into metal.

* STOCKS: LME zinc <0#MZNSTX-LOC-GRD> stocks have fallen to 58,950 tonnes, the lowest since October 2007, and down from around 250,000 tonnes as recently as August. In recent years, traders have been holding metal outside LME warehouses where storage is cheaper.

* TRADE: U.S. President Trump said on Wednesday he was in no rush to complete a trade pact with China and insisted that any deal include protection for intellectual property, a major sticking point between the two sides during months of negotiations.

* COPPER: Southern Copper Corp, one of the world’s biggest copper producers, is evaluating making an investment in a lithium project in Mexico that a Chinese firm is also interested in, the company’s chief executive told Reuters.

* ALUMINIUM: Malaysia said that bauxite miners must each conduct a study on the environmental impact of their sites in the country before receiving licences to restart operations, with a moratorium on mining the aluminium raw material due to end on March 31.

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MARKETS NEWS

* Asian shares paused on Thursday as investors awaited data from China for clues about the health of the world’s second largest economy while the pound shot up to near nine-month highs as the risk of a no-deal Brexit receded following a late-night vote.